Washington, D.C.--“Want to stop the next Madoff? Gut the SEC,” says Yaron Brook, executive director of the Ayn Rand Center for Individual Rights.

“Part of the reason Madoff’s misdeeds went undetected is that the Securities and Exchange Commission spends most of its time doing things the government has no business doing. The only legitimate job of a securities law enforcement division is to protect investors against the specific crimes of theft, fraud, and breach of contract.

“But the SEC plays a much different role. Its mandate is to attempt to make investing ‘safe’ by controlling every aspect of financial markets, from dictating the composition of mutual fund boards to mandating public release of executive compensation numbers that shareholders want kept private to determining when executives are allowed to sell stock--‘insider trade’--instead of leaving that to the discretion of a company’s owners.

“In pretending to guarantee to investors that their investments are sound, which is impossible, the SEC encourages the kind of blind group-think that characterized the Madoff investors. And with the SEC devoting itself to a sprawling array of elaborate witch-hunts, such as the ‘insider trading’ case against Mark Cuban, what time or attention does it have for real fraud?

“The answer--as is clear from the fact that a 29-point, 17-page report on Madoff, submitted in 1999, 2001, and 2005, entitled The World’s Largest Hedge Fund is a Fraud slipped through its cracks--is none.”